Headwaters MB, one of Denver’s last remaining homegrown investment banks, has sold to Boston-based Capstone Partners LLC.

“We started our companies around the same time. We were frenemies, but we rarely competed head to head,” said Philip Seefried Jr., who founded Headwaters with former business partner Dave Maney in 2001.

The combined bank, Capstone Headwaters, will employ 150 people across 18 U.S. cities, as well as London and São Paulo. Boston and Denver will share the headquarters, with 36 employees based in Denver and 25 in Boston.

Seefried will stay on as president, while John Ferrara, Capstone’s founder, will be CEO. The two bankers became friends about five years ago and worked on the combination, which closed in late December, for about a year.

As baby-boomer business owners age, they are looking for an exit strategy. Headwaters invested in the infrastructure to handle more business, but struggled to find skilled investment bankers with specialization in the niches that the firm lacked.

“We were seeing our growth flatten out because the market was good. There weren’t as many free bodies around that fit our profile,” Seefried said.

Headwaters and Capstone both specialize in the sale and purchase of middle-market companies in the $25 million to $200 million range. But the firms had developed expertise in different industries.

Headwaters, for example, is known for its work with companies in lifestyles of health and sustainability or LOHAS, as well as media/telecom, building products and the Internet of things. Capstone has a specialization in juvenile consumer products, industrial manufacturing and education and training.

Capstone also provides services in restructuring companies, a practice that Headwaters wanted to get into, given it is useful in down business cycles.

Seefried, 57, also cited personal reasons for arranging the sale. He had outside shareholders who had been with him since 2001 and who were looking for an exit.

Among the firms Headwaters has helped arrange sales or other transactions for in recent years include Colorado Timberline, Denver Glass Interiors, Empire Gas and Electric, ID Watchdog and Rivet Software.

Among the clients Headwaters has helped ramp up into bigger operations is Aurora Organic Dairy, a Boulder-based provider of private label organic milk and butter.

Seefried emphasized that Denver will continue to be central to the combined Capstone Headwaters.

“There is not a backing off of our Denver location. One firm and one face is the battle cry,” he said.

Aldo Svaldi has worked at The Denver Post since 2000. His coverage areas have included residential real estate, economic development and the Colorado economy. He's also worked for Financial Times Energy, the Denver Business Journal and Arab News.

More in Business

VF Corp, the holding company for popular outdoor brands such as The North Face, JanSport and Smartwool, announced Monday will move its global headquarters to Denver, bringing 800 high-paying jobs to the city.

"The optics are so obvious to so many people in this era of #MeToo," Steven Silvers said of Innovation Pavilion. "Their response to this crisis is going to have a far lengthier and more damaging effect on the company than if they handled it more directly."

The work, which ranges from remodeling some restaurants to scarping off and completely rebuilding older structures, is part of a $6 billion modernization effort McDonald's will roll out across the U.S. by the end 2020.